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Insurance Bureau of Canada calls for elimination of insurance tax in Newfoundland and Labrador: Unnecessary tax takes $80 million out of pockets of Newfoundlanders & Labradorians

ST. JOHN'S, Jan. 15 /CNW/ - Insurance Bureau of Canada (IBC) today
reiterated its long-standing call to the government of Newfoundland and
Labrador to remove taxes on insurance premiums.
"The people of Newfoundland &amp; Labrador have the highest insurance tax
burden in the G8," said Don Forgeron, Vice-President, Atlantic, Insurance
Bureau of Canada. "For every dollar of home, car and business insurance they
buy, the provincial government charges them 19.6 cents in tax. This adds up to
$80 million annually."
He added: "These unnecessary taxes are an unfair burden on homeowners and
drivers, for whom insurance is a vital product. Premium taxes are also an
impediment to businesses and not-for-profit organizations. Because these taxes
are levied as a percentage of insurance premiums, organizations that face
higher risk are also hit with more tax. Sectors most severely affected include
not-for-profits, the hospitality industry and exporters."
IBC has stated its objections to the province's high level of insurance
tax in government submissions over many years. The tax problem in the province
as compared to other jurisdictions has been clear since IBC commissioned a tax
study by tax expert Jack Mintz in 2002. Recently, the IBC-led,
multi-stakeholder Atlantic Task Force on Insurance Availability and
Affordability also called for the elimination of premium taxes in the
province.
In the fall of 2006, the government of Newfoundland and Labrador said it
would review the level of tax on insurance products. Insurance buyers deserve
a decision soon.
Insurance Bureau of Canada is the national trade association of the
property and casualty insurance industry. Its member companies provide nearly
95% of the private home, car and business insurance sold in Canada.